Case Study

Literature

Stamp duty reform 'will boost housing market'

12th December 2014

The chancellor's reforms to stamp duty will serve to boost the UK housing market.This is according to the Royal Institute of Chartered Surveyors (RICS), which said surveyors expect the changes to drive increased sales of between two and five per cent, combatting recent declines.RICS claimed the reforms may well tempt buyers into activity, but a critical issue will be whether or not it encourages more vendors to put their properties back on the market.Jeremy Blackburn, head of policy at RICS, stated: "It’s no surprise that surveyors are expecting an uplift in the market in response to the long overdue reforms to the stamp duty tax system, which the chancellor himself called ‘the most damaging tax of all’. Removing the ‘dead zones’ will reduce the distortion in the market."He added that the changes should ensure those at the top of the market make a fairer contribution, while those at the bottom will have an improved chance of getting on the property ladder.RICS said it is particularly important that the reforms boost the housing market, as the organisation's data suggests the surveyors' inventory levels are close to reaching a historic low. Announced in the Autumn Statement, the changes to stamp duty are due to reduce the tax for 98 per cent of people who pay it. The reforms have generally been well received and have attracted praise for making the property market fairer. However, there has been some negative feedback, with James Wyatt, the Surrey chair of the National Association of Estate Agents, telling Property Reporter people in the Home Counties will pay the price for the changes. He claimed this could cost the Conservatives votes in what is a hugely important region for the party.Results of a survey recently released by eMoov found that 22 per cent of would-be homebuyers with a budget of up to £200,000 were concerned about stamp duty, with the figure rising to 38 per cent among those with more than £500,000 to spend.However, it should be noted the research was carried out prior to the Autumn Statement, meaning sentiments will likely have changed.